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strengthened further. One of the considerations would be the position of the product in the life
cycle. Products getting obsolescent need not be continued with. Another consideration would
be the contribution that the product is making to the total performance of the company. In
insurance, the contribution can be determined in terms of clams ratio, volumes of premium, size
and nature of segment catered to, costs relative to premium, etc.
2. The Boston Consulting Group had developed a grid known as the Boston Matrix, to do this
analysis. It takes into account the appropriate stage in the life cycle reached by various products
and the relative market share of the products. The term `Relative market share' used in the
matrix indicates the market share enjoyed by the product with reference to the other main
operators and market growth rate indicates the rate of growth of the total market for that
product.
E. DISSONANCE
1. The factors affecting perceptions or customers are different before, during and after purchase.
Before purchase, they are affected by the image created by the brand, previous experience,
what the friends say, published results and endorsements and the price as advertised. During
purchase, the relevant factors are the performance specifications, the salesman, the warranties,
service and repair arrangements, support programmes and the price which is quoted.
2. In the case of insurance after the ourchase the only experience to create a perception, is the
continued attention and concern shown to the customer, which would reassure him that the
promise he believed in while making the purchase, was not misplaced. If he does not receive
such attention and expressions of concern, he could start doubting the bonafides of the
salesman. That is the first step to having doubts about the wisdom of the purchase. This is what
is known as `Dissonance'. Dissonance is likely to be more frequent in the case of insurance
purchases than in other purchases, because of the following.
in insurance, the payment of premium is real and immediate while the benefit is distant and
uncertain
In most other purchases, there is a predisposition or willingness to buy, while in insurance, it is
as if the purchase has been forced. The need is not felt strongly.
Policyholders feet a sense of loss or waste if the claim does not occur
There are conditions and warranties which the policyholders, being unaware of their
implication, could ignore affecting the validity of the insurance policy.
F. MARKET RESEARCH
(a) Limitations
Market research is the traditional method of finding out customer needs, on the basis of which product
strategies may be developed. A variety of techniques, like surveys, questionnaires, interviews,
observations etc., have been developed to do market research in relation to goods. There are limitations
in using these in the case of services, mainly because services are intangible, difficult to measure or
sample and even difficult to articulate precisely.
(b) Contact Points
Sashi Publications Pvt Ltd Call 8443808873/ 8232083010